MKT 230 (2)
Terms
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- merchandise mix
- the total set of all products offered for sale by a retailer, including all product lines sold to all consumer groups
- demographics
- changing retailing practices in these ways: 1. demanding greater convenience (longer hours of operation) 2. increasing catering to specific age segments 3. there is a growing recognition of ethnic diversity
- Retailing is big business
- 1 in 5 US workers are in retailing. There are over 1.2 million retail firms, but only about 8% of them have annual sales greater than 2.5 million. In other words, most retail business in the US is small business!
- 34.7 billion
- 3rd quarter e-commerce retail sales
- A. convert stores into one-stop shopping centers B. generate more traffic C. realize higher profit margins D. increase impulse purchases
- Why retailers use scrambled merchandising:
- discount stores
- general merchandise discount stores- retailers that offer a broad assortment of items at low prices
- soft goods= clothing and home furnishings. hard goods= appliances
- Department stores focus on different assortment strategies:
- cigarettes (34.4% of in-store sales)
- #1 product sold in convenience stores
- Home Depot
- What was the number 2 retail store in 2006?
- atmospherics
- the use of color, lighting, scents, furnishings and other design elements to create a desired store image
- department stores
- retailers that sell a broad range of items and offer a good selection within each product line.
- merchandise breadth
- the number of different product lines available
- convenience stores
- neighborhood retailers that carry a limited number of frequently purchased items and cater to consumers willing to pay a premium for the ease of buying close to home
- Limited-Service retailers
- in-between (Walmart, Target, Old Navy, Kohls)
- Retail Life Cycle
- a theory that focuses on the various stages that retailers pass through from introduction to decline
- supermarkets
- food stores that carry a wide selection of edibles and related products
- multilevel network
- a system in which a master distributor recruits other people to become distributors, sells the company's products to the recruits, and receives a commission on all merchandise sold by the people recruited (Amway)
- demographics, technology, globalization
- 3 factors motivate innovative merchants to reinvent the way they do business:
- introduction stage
- usually competes on low price. Profits are generally low because of high development costs.
- 381.4 billion. This translates to 4.6 trillion this year.
- US retail food services for March 2008?
- 5.4%, $3.9 trillion
- Retail sales were up how much in 2006?
- $569 billion
- convenience store industry sales top____ in 2007?
- 1. lack of security 2. fraud 3. cant touch items 4. exact colors may not reproduce on computer monitors 5. expensive to order and then return 6. potential breakdown of human relationships
- benefits and limitation of e-commerce for the consumer
- Full-Service retailers
- these retailers provide supporting services and trained sales assistants (Bloomingdales and Victoria's Secret)
- growth stage
- sales and profits rise, but this also attracts more competition
- consumer privacy protection is NOT one
- benefits and limitations of e-commerce for the marketer
- 1. central business districts 2. shopping centers 3. freestanding stores 4. nontraditional locations
- types of store locations
- decline stage
- the retail business has become obsolete as newer ways of doing business emerge
- maturity stage
- parity emerges among competitors and it is difficult to maintain customer loyalty.
- merchandise assortment
- the range of products sold
- scrambled merchandising
- a merchandising strategy that offers consumers a mixture of merchandise items that are not directly related to one another
- specialty stores
- retailers that carry only a few product lines but offer good selection within the lines that they sell
- Wheel of Retailing
- a hypothesis that new retailers usually enter the market as low-status, low-margin, low-price operators but eventually evolve into high-cost, high-price merchants.
- Carrefour
- #2 global retail store...
- pyramid schemes
- an illegal sales technique in which the initial distributors profit by selling merchandise to other distributors, with the result that consumers buy very little products
- merchandise depth
- the variety of choices available for each specific product line
- Supermarket
- #1 retail format
- technology
- revolutionizing retailing. 1. Point of sale (POS) systems: retail computer systems that collect sales data and are hooked directly into the store's inventory control system
- party plan system
- a sales technique that relies heavily on people getting caught up in the "group spirit," buying things they would not normally buy if they were alone (Tupperware)
- globalization
- the world is becoming a smaller place. Globalization is a 2-way street. Innovative retailing concepts developed overseas are influencing US retailing. However, retailing practices must often be modified depending on the country where the retailing practice occurs